EXPLANATORY STATEMENT
STATUTORY RULES 1986 NO. 390
ISSUED BY THE AUTHORITY OF THE TREASURER
AUSTRALIAN CAPITAL TERRITORY TAX (TRANSFERS OF MARKETABLE SECURITIES) REGULATIONS
These regulations prescribe certain kinds of transfers of marketable securities for the purposes of paragraph 6(1)(a) of the Australian Capital Territory (Transfers of Marketable Securities) Act 1986 (the Act). Paragraph 6(1)(a) of the Act exempts such transfers from the tax imposed by the Act.
The Act imposes tax on the registration, by a company incorporated in the Australian Capital Territory (ACT), of a transfer of a marketable security where -
• the relevant instrument of transfer was executed by the transferor, or by any of the transferors, after the commencement of the Act; and
• immediately before the date of execution of the instrument of transfer, the marketable security was registered in a register kept outside the ACT.
The rate of tax imposed in respect of such transfers is 15 cents for every $25, or part thereof, of the unencumbered value of the marketable security.
By the operation of paragraph 6(1)(a) of the Act, these regulations in effect exempt from tax the transfer of a marketable security where the marketable security was, immediately before the date of execution of the relevant instrument of transfer, registered in a register kept in a jurisdiction specified in the regulations in relation to the particular kind of marketable security. The jurisdictions specified are those Australian States where stamp duty or similar tax, at rates broadly equivalent to those applying in the ACT, is payable in respect of the transfer.
Comments on the regulations follow.
By regulation 1, the regulations may be cited as the Australian Capital Territory (Transfers of Marketable Securities) Regulations.
By virtue of regulation 2, the regulations are deemed to have come into operation at 5 pm, by standard time in the ACT, on 10 June 1986. This ensures that the exemption from tax provided by paragraph 6(1)(a) of the Act for the kinds of
transfers of marketable securities prescribed takes effect from the same time as the Act imposing tax is deemed to have come into operation. But for this regulation, the Regulations would have come into operation on the day on which they were notified in the Gazette.
Regulation 3 is a drafting measure which enables the Australian Capital Territory Tax (Transfers of Marketable Securities) Act 1986 to be referred to in the Regulations as “the Act”.
For the purposes of paragraph 6(1)(a) of the Act, regulation 4 prescribes the following three kinds of transfers of marketable securities:
• a transfer of a share in a company, being a share that, immediately before the date of execution of the relevant instrument of transfer, was registered in a register kept by the company in New South Wales, Victoria, Queensland, Western Australia, South Australia or Tasmania (paragraph (a));
• a transfer of a debenture of a company, being a debenture that, immediately before the date of execution of the relevant instrument of transfer, was registered in a register kept by the company in Tasmania (paragraph (b));
• a transfer of a right to a share in a company, being a right that, immediately before the date of execution of the relevant instrument of transfer, was registered in a register kept by the company in New South Wales, Victoria, Queensland, Western Australia, South Australia or Tasmania (paragraph (c)).